In my three years of blogging at HA, this may be the first time I’ve seen the boss and Grahamnesty on exactly the same wavelength. Credit where credit is due: I thought he and McCain would be a collective rubber stamp for The One on all things “bipartisan” but they’ve both come out hard against this boondoggle. And then some: This is as close to bareknuckle as you’ll ever see from this guy, especially the shots at Obama’s leadership. I figured the GOP would keep triangulating between Obama and Pelosi, blaming the Democrats while staying well clear of attacking our new Messiah, but it looks like the bill is now sufficiently toxic that they think they can use it to score some points on him, too. Sweet.
Republican Senator Susan Collins of Maine said Obama, in a meeting with her on Wednesday, had persuaded her that the ultimate bill should be “in the neighborhood of $800 billion.”
“The president did convince me,” she said, adding that she believed the two sides would reach a compromise on the Senate stimulus package on Thursday.
Update: Via Instapundit, turns out The One is right to be afraid. Just not for the reason he thinks.
CBO, the official scorekeepers for legislation, said the House and Senate bills will help in the short term but result in so much government debt that within a few years they would crowd out private investment, actually leading to a lower Gross Domestic Product over the next 10 years than if the government had done nothing…
CBOs basic assumption is that, in the long run, each dollar of additional debt crowds out about a third of a dollars worth of private domestic capital, CBO said in its letter.
CBO said there is no crowding out in the short term, so the plan would succeed in boosting growth in 2009 and 2010.
Update: One of our three lefty readers e-mails to say that the Wash Times misread the CBO letter to Gregg and that there actually will be net growth. The key passage from the story is this:
CBO estimates that by 2019 the Senate legislation would reduce GDP by 0.1 percent to 0.3 percent on net…
The agency projected the Senate bill would produce between 1.4 percent and 4.1 percent higher growth in 2009 than if there was no action. For 2010, the plan would boost growth by 1.2 percent to 3.6 percent.
The confusion lies in the term “on net.” Does that refer to the entire period from 2009 to 2019 or the period not including 2009 and 2010, since specific growth numbers for those two years are provided? If the former, then the Times is right and CBO is claiming that the loss in GDP from 2011 to 2019 will wipe out any growth over the next two years for a net loss. If the latter, then the Times is way off. Simple math, per the guy who e-mailed me:
2009: 1.4 to 4.1
2010: 1.2 to 3.6
2011-2019: -0.1 to -0.3
Worst Case 2009-2019: 1.4 + 1.2 – 0.3 = 2.3% positive total effect
Best Case 2009-2019: 4.1 + 3.6 – 0.1 = 7.7% positive total effect
I’m trying to find a copy of the CBO letter to resolve the discrepancy but the site is down right now. Can anyone help?